What I learned trying to answer a deceptively simple question: can stablecoins actually work for the people who need them most?
I came into this trying to understand whether stablecoins could work outside the narrow use cases they're mostly deployed for today. That meant looking at what already exists (USDC, DAI, experimental projects like $BREAD), imagining what could exist (CONCORDIA for commodity trade, $DUX for creator economies), and stress-testing the whole structure through security modeling.
The further I went, the clearer a pattern became—what I started calling the "Impossible Triangle." No stablecoin design seems able to simultaneously maximize capital efficiency, decentralization, and stability. Every project picks two and compromises on the third. USDC gets efficiency and stability through centralization. DAI chases decentralization but ends up dependent on USDC anyway. Experimental models try new trade-offs but hit real-world walls around liquidity, custody, or coordination.
The work also forced me to reckon with things I didn't expect to matter as much as they did: how SVB's collapse rippled through "decentralized" protocols, why Brazilian crime factions might actually be ideal adversaries for certain attack vectors, and what happens when circuit breakers monitor the wrong signals.
If I had to frame it as a question: Can we design stablecoins that hold their peg, use capital efficiently, and stay meaningfully decentralized—especially in places like Latin America where traditional finance already fails people? I'm not sure the answer is yes. But the attempt to answer it taught me what the real constraints are.
I started by examining three stablecoins that represent fundamentally different bets: USDC (centralized, fiat-backed, completely dependent on US regulatory goodwill), DAI (supposedly decentralized but increasingly reliant on USDC as collateral), and $BREAD (a cooperative experiment that's more about values than market dominance).
The framework I used—Purpose, Infrastructure, Governance—came from trying to understand not just how these things work technically, but what they're actually for and who gets to decide when things go wrong.
After studying what exists, I wanted to see what could exist if you started from actual use cases rather than crypto-native assumptions. CONCORDIA emerged from thinking about commodity-backed settlement between Brazil, Chile, and their trading partners—countries with real strategic minerals but stuck in someone else's financial infrastructure. $DUX came from looking at Brazil's creator economy, where people with verifiable brand contracts still wait 30-90 days to get paid.
Neither is "better" than existing stablecoins. They're attempts to map different trade-offs: CONCORDIA accepts slower governance for geopolitical neutrality, $DUX accepts centralized underwriting for actual cash flow utility.
The security work started with a basic question: what does it actually cost to break a small stablecoin? Not theoretically—economically. I modeled attacks on Mento's cREAL (a $372K market cap Brazilian Real stablecoin), looking at oracle manipulation, circuit breaker bypass, and cascade scenarios.
What I found wasn't that the attacks were easy—they're not. It's that the defenses were watching the wrong things. Circuit breakers that monitor oracle feeds but ignore external DEX prices create blind spots. A patient, distributed attack staying under velocity thresholds could be profitable with as little as $100K capital. The interesting part wasn't the attack itself but what it revealed about where security assumptions break down.
The methodology evolved as I went, but a few patterns held. I kept asking what each protocol was actually for, how the technical choices enabled or constrained that purpose, and who got to decide when things went wrong. The framework that emerged—Purpose, Infrastructure, Governance—wasn't planned from the start. It came from realizing you can't evaluate a stablecoin without understanding these three dimensions.
Every protocol analyzed through: Purpose (market need), Infrastructure (technical architecture), and Governance (decision-making).
Modeling adversarial scenarios with realistic threat actors (financial attackers, organized crime, state-sponsored) and economic constraints.
Side-by-side evaluation of protocols across collateral types, capital efficiency, decentralization, and governance models.
Creating experimental architectures to test hypotheses about collateral types, market fit, and governance structures.
Incorporating real-world incidents (SVB crisis, specific protocol exploits, depeg events) to validate theoretical findings.
Special attention to LatAm markets, examining how stablecoins can address regional challenges (debt, trade, financial inclusion).
Stablecoin projects cannot, until now, simultaneously optimize capital efficiency, decentralization, and stability. Every design involves trade-offs—USDC chooses centralization for stability, DAI sacrifices capital efficiency for decentralization, and BREAD explores new compromises.
Critical vulnerability: Circuit breakers that monitor oracle feeds but not external market prices enable arbitrage attacks during depeg events. Attackers exploit the gap between oracle-reported prices and real market prices to extract value while appearing compliant with safety mechanisms. Without solving the challenge of following onchain transactions at a reasonable price, Circuit Breakers will still face this challenge.
Protocols may maintain price pegs (stability) while experiencing severe liquidity disruptions. Seemingly minor depegs (1-2%) can indicate deeper structural vulnerabilities that manifest as liquidity crises rather than immediate price collapse.
Web3 infrastructure can address geopolitical coordination problems, not just financial ones. CONCORDIA demonstrates how public blockchains enable neutral infrastructure for nations with competing interests by providing verifiable fairness through transparent, multi-sovereign governance.
Single-layer protections are insufficient against sophisticated adversaries. Effective security requires overlapping systems with different monitoring approaches—but even multi-layered defense has exploitable gaps when layers share assumptions.
RWA-backed stablecoins face unique challenges: custody complexity, redemption logistics, and regulatory compliance. Success requires not reinventing traditional infrastructure but integrating it transparently with blockchain rails. The innovation is transparency, not replacement.
The complete research is documented across 25 Google Docs, organized by research phase:
Total: 23 research documents — 8 for Comparative Analysis, 3 for DeFi Security, 3 for Attack Modeling, 4 for Design Experiments, 3 for Website Content, and 2 for Project Management.